Capitalizing on Credibility - What's the Biggest Payoff? August 2010

The Myth of Client-Focus July 2010

Marketing Therapy - Just lie back and relax... June 2010

The Producer's Guide to Asking Questions May 2010

Questions - The Shortest Path from Prospect to Client April 2010

How to Build Your Credibility March 2010

Credibility's Impact on YOUR Bottom Line February 2010

How to Use Social Media in Your Business December 2009

Psychological Analysis of Your Marketing September 2009

How Contrarian Logic Makes Sales for You August 2009

Words that Sell - How to Use Psychology in Your Marketing and Selling July 2009

The Secrets of Marketing Psychology (Part I) June 2009

You've been replaced by a cartoon! May 2009

8 Ways to Distinguish Yourself in a Challenging Market (Part II) April 2009

8 Ways to Distinguish Yourself in a Challenging Market (Part I) March 2009

The Worst Mistake in Selling Financial Services January 2009

Fighting for Success! The “Special Forces” Approach December 2008

Yours - Free! November 2008

First-Impressions of Credibility - Part One October 2008

12 Ways to Screw Up Meetings -- And How to Fix Them September 2008

Article Index

Purdue University researchers Tim Christianson and Sharon DeVaney examined interpersonal relationships between financial advisors and clients. In particular they identified factors that facilitate a client's feelings of loyalty. Of all the factors examined in their study, by far, the one that had the strongest influence on an advisor's ability to win a client's trust and commitment was communication.

Lesson Number One: The warm call — contacting your existing clients.

Having read that box above, let me tell you about two of our coaching clients who failed to learn that lesson and will likely carry guilt around with them for the rest of their lives because of it. In both cases, the market was turning down and their clients began to lose money — having followed these advisors' investment recommendations.

In the first case, the advisor was responsible for his clients' losing more than 50% of their holdings. That was several years ago. In the second case, our conversation with him was just within the past month. He still has not contacted his clients to discuss with them the current volatility. And, we're still working on him to recognize his accountability.

Having been a consultant in this industry for many years, I can almost hear the voices yelling, "Yes, Mike, but Buy and Hold. It will come back." That's a legitimate belief, unless the clients are older and don't have the time to hold and wait for the market to rebuild their holdings. To not contact your existing (older) clients during a down turn, is to significantly devalue them and expose them to terrible financial anxiety. Where is the credibility in that?

What is the point here? You can increase your credibility with your existing clients merely by contacting them during volatile times and discussing their specific situation. This is how you can increase your income and gain more referrals. The referrals happen when you prove to your clients that you are truly credible. Part of credibility is simply being there when they get frightened or concerned. So, the guideline is: contact your clients in tough times. Why is this such an important point? Because far too many advisors avoid their clients during down turns.This is, then, a way for you to show that you are indeed different and better.

Lesson Number Two: The cold call — contacting strangers.

During a coaching call with a group of Canadian advisors, my partner and I were leading the group through some cold-calling exercises. Their performance was terrible. These guys meant well, but had absolutely no idea of what they sounded like or how they were coming across to the person on the other end of the line. They also thought their goal was to make a sale and that the psychology was to show how smart they were.

* If you don't understand the psychology of cold calls, contact me immediately. Just fill out the feedback form below. Be sure to include this paragraph and all your contact information.

Mistake #1. Their first mistake was without a doubt the biggest mistake that financial advisors make. They dove deep into detail. "Hello, might I interest you in a tech stock that has shown great promise for growth through market fluctuation?" If these guys were hard-core stock jocks, that might be an OK beginning, but they were wanting to build a relationship-focused business.

Mistake #2. Their second mistake was to ignore the listener. They would ask a question, then not respond or even acknowledge what the prospect had just said.

Mistake #3. Their third mistake was to jump quickly into a sales pitch. There is a comfortable order for these calls. First, get the prospect to say something. Second, acknowledge it. Third, ask a question designed to pique his interest. Fourth, agree with what he says. Fifth, expand the conversation and move it forward. Ask, respond, expand — repeat if necessary.

The devaluation of — you. Because too many advisors claim to be all things to all people, the advice being given by the entire industry is seen as less valuable. "I'm a financial advisor, and I also do life planning and estate planning and college funding. And, of course I pick my own stocks, but my real strength is in protecting your assets through annuities and long term care insurance."

So, the goal of a cold call cannot be to make a sale right there on the spot. Sounds simple and logical, but just about every advisor we've ever spoken to has aimed at making a sale or setting an appointment. In today's business environment, we believe that approach is lunacy. The goal must be to simply have a positive conversation with that person. The strategy is simply to make it possible to either share information or have additional conversations. I can hear you say, "But Mikie baby, that's not the way we do it." I know that. And, for that reason this is a far better approach. The guideline here is: Always do what no one else is doing.

Cold Call Scripts. What might you say in a cold call today? Well, what is in the prospect's mind? Let's see, the market has been insane. The housing market has been insane. Nothing is as it seems it should be. What does that tell you? That investors are starting to get worried or at least confused. Now, the big question — how many advisors are contacting their clients, if only to tell them to "Hold the course."? Probably few if any. And, what does that tell you is the opportunity right now for you?

Simply start calling people. Say, "Sir, this stock market is crazy, volatile and highly unpredictable. I'm wondering, have you heard from your financial advisor lately?"

Let's flash back to the points I made at the beginning of this article:

1. Communication, by far, has the strongest influence on an advisor's ability to win a client's trust and commitment. Communication gives life to credibility.
2. Most advisors stop communicating with their clients when times are tough (like now). Silence is the death to credibility.
3. Most advisors do not know how to structure an informational cold call.

What's that spell? It spells opportunity for you. It spells opportunity to grab some low-hanging fruit in the shape of someone else's clients. Those would be people who are comfortable investing and are having a negative experience with their existing advisor.

The credibility begins at the point you make your conversation meaningful to that person. And, that point is very likely to be the instant you ask the question — "I'm wondering, have you heard from your financial advisor lately?"

Assuming the prospect steps into the conversation and answers your question, you have several very intriguing questions to pose. These are rarely ever uttered by other financial professionals, perhaps because they don't want to call attention to these "sticky" issues. Let's look at some mind-bending questions:

1. I can tell you from my side of the desk that each advisor likes a different type of client relationship. Do you think your advisor has built a relationship with you?
2. Unless you have an advisor who sells a single product, he probably promised you comprehensive service. Does that sound familiar?
3. The term "Comprehensive" means that the advisor helps with literally every aspect of your money: taxes, mortgage, bank fees, trusts, insurance, investments, and major purchases. Has your advisor spoken with you about how you might be impacted by the collapse of the mortgage industry?
4. Many advisors today refer to their business as "Wealth Management." Has your advisor used that term?
5. The client-relationship model that dominates is the "hands-off approach." It is pure efficiency. Other than for a periodic review, the less the advisor hears from you the better, and the fewer contacts he has with you the better. We also call this the "no service model." It is completely one-side, weighted to the advisor, not you. Can you recall how many times this year your advisor has initiated a personal contact with you?
6. The other dominant financial model is based on financial accumulation. The advisor helps you accumulate as much money as possible in the most efficient way possible. Most investors think this is a good deal, after all accumulation is good, right? It is if you're young and can weather the ups and downs of the market over time. But, accumulation is not so good if you're anywhere close to sixty. After that age, people need to start thinking about distribution of their money, not accumulation. Do you mind if I ask about your age? Are you near retirement age? Has your advisor told you about distribution?

In Conclusion. Most advisors focus on maximizing their incomes in the most efficient manner. That means there are many clients being under served, and each one of them is a potential new client for you. That's because service takes time and energy, and for advisors seeking more money under management, service and communication divert their focus, thus reducing their efficiency, thus reducing their new money under management, thus reducing their incomes. Knowing that, you can position yourself as the high-touch, high-service advisor. All you have to do is talk with people and show them what real service is like.

The Eyes Have It. I teach all my coaching clients to look at the financial industry through the client's eyes. What does the client think advisors do? What level of service do clients expect, versus how much service that actually get?

Take a close and objective look at the way most advisors approach their businesses. Spot the things that they do not do for their clients. Those are fertile areas for you to highlight and step into. They mark how you can become different and (hopefully) better than most other advisors. And, they are the basis for your new and improved credibility.

Your Reward — Save $10,000. The quickest way to gain the most credibility is to be an author of a book that is relevant to your target market. If it is Estate Planning or Life Planning, call me immediately. I can save you about $10,000 and make you an author. Your credibility will skyrocket, your sales cycle will shrink, and you'll get more clients more easily. Call me at: (509) 465.5599, or fill out the feedback form below.

MICHAEL LOVAS is the author of ten books, three columns, and a thousand articles on Professional Credibility and the Psychology of Communication in the financial industry. He's the co-founder of AboutPeople and the founder of Credibility Marketing.

Michael speaks at conferences and seminars in Canada and the US. He is an inspiring trainer and coach who helps advisors improve their businesses. He holds three prestigious certifications: Licensed Master Practitioner of Neuro-linguistic Programming (NLP), Licensed Trainer of NLP; and Clinical Hypnotherapist. They make Michael an expert at helping financial professionals succeed at a higher level by building more meaningful business relationships.

AboutPeople Books:

1. (NEW) Questions Are the Answer! - A guide for using questions effectively in sales conversations
2. (NEW) Axis of Influence! - How credibility & likeability intersect to drive success!
3. (NEW) Words that Sell - The language of psychological marketing & selling
4. Face Values - How to read people and connect with them in less than 3 minutes!
5. The Boomer Report - The financial advisor's guide to understanding the boomer mind
6. Presentation Magic - How to gain a psychological advantage in your seminars and sales presentations
7. The 5 Levels of Rapport - How to create a meaningful connection with people who are important to you
8. Magnetic Connections - Consultative selling for financial professionals
9. IDENTITY - How to create and deliver the most important statement of your business life
10. Inside the Mind of the Senior Market
11. Beyond Wave Marketing - How to add credibility to your relationship marketing

Find AboutPeople books at: www.aboutpeople.com

Michael Lovas, C.Ht.
AboutPeople
(509) 465-5599
1503 E. Riverview Dr.
Colbert, WA 99005
www.aboutpeople.com

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